Members of the House of Representatives talk to virtual-world pioneers from Second Life and avatars on video screens about whether there is a need for some regulation of virtual worlds.

WASHINGTON
(Reuters) - The founder of virtual world Second Life sought to reassure
U.S. lawmakers on Tuesday that the online community is able to police
itself.

Second Life founder Philip Rosedale and a handful of other virtual
reality experts, testified at a House of Representatives hearing that
was also attended by on-line personas, or avatars, portrayed on a video
screen in the hearing room.

"It is likely that virtual world activities are somewhat more
policeable and the law somewhat more maintainable within virtual
worlds," said Rosedale, chief executive of Linden Lab, the company that
runs Second Life.

Some lawmakers raised questions about what operators of virtual
worlds are doing to stop them being used to stage real-world crimes
such as terrorism, money-laundering and the exploitation of children.

"I am not advocating censorship. But I am asking what we can to make
certain that these glorious tools are not ... changed into tools that
facilitate the use of terror attacks on innocent civilians around the
world," said Democratic Rep. Jane Harman, of California.

Harman cited a British newspaper report last year saying that
Islamic extremists were suspected of using Second Life to recruit and
mimic real-life terrorism.

"We have never seen any evidence that there is any such activity
going on," Rosedale told the House Energy and Commerce subcommittee on
telecommunications.

Second Life is an online community with several hundred thousand
users who create their own avatar identities and can fly around the
virtual world at will.

In addition to entertainment, Second Life has created its own
currency -- the Linden dollar which can be converted to U.S. dollars --
in an active marketplace which supports millions of dollars in monthly
transactions.

Lawmakers on the panel said the hearing was held for informational
purposes and no legislation is planned. Rosedale, appearing in both
physical and avatar form, outlined steps the company takes to
"discourage and prevent illegal activity."

He said gambling is banned and financial transactions are closely
monitored. Teenagers are restricted to a separate teenage-only version
of Second Life, he told them.

"The virtual world has a degree of accountability ... and
traceability which actually in many ways is better than the real
world," Rosedale said.

On the video screen in the hearing room were about two dozen avatars
from Second Life. They sat quietly, while their comments were displayed
at the bottom of the screen.

At least two of the avatars had wings. A third turned into a giant bumble bee as the hearing ended.

Also on the screen was an avatar representing Rep. Edward Markey, the Massachusetts Democrat who chairs the subcommittee.

Rosedale and other experts said virtual reality was the next step in the evolution of the Internet.

"Virtual worlds and spaces are quickly becoming powerful tools with
the potential to transform enterprise and government processes by
increasing top line and bottom line growth, improving efficiency and
productivity, and augmenting our ability to innovate and spur
entrepreneurial growth," IBM vice president Colin Parris told the panel.